In the recent 2016-17 Victorian state budget there was one change to payroll tax that may positively impact a number of Victorian businesses.
This was the increase in the threshold of Payroll tax from $550,000 to $650,000 progressively over the next 4 years. The payroll tax threshold has not changed since 2002 for Victoria.
How will this work?
The tax free threshold will increase to $575,000 on 1 July 2016, to $600,000 on 1 July 2017, to $625,000 on 1 July 2018 and $650,000 on 1 July 2019.
The estimated cost to the government over this period would be $286 million. This would mean that out of the 36,600 businesses paying payroll tax about 2,800 businesses would be exempt.
What can you do?
It may be worthwhile to review your business structure and remuneration model for related parties (ie owners) IF your business is close to the above threshold. At Sharp Accounting we can assist with this if you wish.
Sharp Accounting is a local accounting firm in Ballarat. Sharp Accounting nurture business growth by adding value through collaboration and shared knowledge.